I think the answer to your first question is: Are you a writer or a publisher, or both?
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Matthew Read♦May 11 '11 at 0:35

@MatthewRead: I'm a musician, but I know that many musicians nowadays set up their own (albeit unincorporated) publishing companies. Is that worthwhile?
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Maxim ZaslavskyMay 11 '11 at 0:44

That's a whole different question, and to answerable we'd have to know a lot about your goals, abilities, etc. I'm not sure this is the right platform for that, but maybe you could ask in the chatroom.
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Matthew Read♦May 11 '11 at 0:52

@MatthewRead: Oh okay, thanks. Honestly, this whole question is more of a hypothetical one, since I'm just curious as to why some people decide to make their own publishing companies/register for those PROs as a publisher, while others don't bother and register as a writer. I don't think I'll be doing either any time soon :)
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Maxim ZaslavskyMay 11 '11 at 1:27

1

Are you planning on representing the works of other songwriters? Do you collaborate in your songwriting? If the answer is 'no' to both of these, I don't see any value in registering as a publisher.
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James TauberMay 11 '11 at 3:21

3 Answers
3

If you plan to represent and collect for other songwriters/composers, you obviously need to register as a publisher.

If you collaborate with other songwriters/composers, one (possible) advantage of registering as a publisher is you don't need to tell the PRO the split between the collaborators; you can establish that separately (usually in a contract between publisher and the other writers) as the PRO will just make a single payment to the publisher. Also, you can enter into agreements without having to get all the collaborators involved each time (although I think this is more of an issue with things like mechanical and sync rights than performance rights).

There may also be income tax implications in receiving royalties as an individual versus publishing company.

In virtually every nation in the world, except the United States of America, each nation's government has its own bureau which collects royalties for songwriters and publishing companies, and disburses the funds to the songwriters and publishing companies (the "rights holders") after they withhold administrative costs.

However, in the USA, we do things by the private sector and capitalism. ASCAP and BMI are independent non-profit organizations who perform this function.

There is also a third performing rights company, SESAC, which operates in the USA. It is a privately held, for-profit company.

All three of these performing rights organizations collect royalties for songwriters and publishing companies regarding performances within the USA. These agencies also deal with the performing rights government bureaus of all the other nations of the world to collect royalties for American composers when their music is performed overseas, and for foreign composers whose works are performed in the USA.

There is a misapprehension that these performing rights organizations are "labor unions". They are not. They exist to collect royalties based on the USA and international laws.

ASCAP was started by music publishing companies, and was the first such company, and the only one for many years. BMI was created as a rival organization by the national association of radio stations in 1939 at a critical juncture when ASCAP wanted to raise the rates that radio stations had to pay to ASCAP to collect royalties for songwriters when they played their records. BMI started luring songwriters away from ASCAP with the promise of higher payments. For a short time, radio stations refused to play records of songs written by songwriters who registered with ASCAP. From 1939 to 1941 there was a huge struggle until the US government intervened and created a legal framework for both groups to coexist.

Today there is little functional difference between ASCAP and BMI. I'm told there was a time when a professional songwriter registered with ASCAP would refuse to co-write a song with another songwriter registered with BMI, because it made collecting any royalties on a co-written song much more difficult. But these days those barriers seem to have gone away.

More and more people are self publishing, as the standard model of the music publishing industry gets further and further behind reality and the price of self publishing goes down.

I would say: weigh up the annual cost and if there is a chance you may publish (and this includes online only eg through iTunes, Play.com etc) it is well worth looking into.

As @James said the collaboration angle mainly has a difference around sync rights and mechanical royalties - but I wouldn't worry so much about the difference around PRO paying to one individual or more as that shouldn't change the amount you get.